Saudi Arabia says US asked for 1-month delay in OPEC+ production cuts

DUBAI, United Arab Emirates (AP) — Saudi Arabia said on Thursday it had asked the United States to postpone a decision by OPEC and its allies, including Russia, to cut oil production by a month. Such delays may have helped mitigate the risk of gas prices skyrocketing ahead of next month’s US midterm elections.

A statement issued by the Saudi foreign ministry did not specifically mention the Nov. 8 election, in which US President Joe Biden seeks to maintain a narrow Democratic majority in Congress. However, he said the US had “proposed” to delay the cuts by a month. After all, OPEC announced the cuts at a meeting in Vienna on October 5th.

Postponing the cuts will likely delay gas price increases until after the election.

Higher oil prices, and thus higher gasoline prices, have been a major driver of inflation in the United States and around the world, and the global economy has been hit hard as Russia’s months-long war against Ukraine has disrupted the world’s food supply. Making the predicament worse. For Biden, higher gas prices could affect voters. He and many lawmakers have warned that the longstanding security-based relationship between the United States and the Kingdom could be reconsidered.

The Saudi foreign ministry’s unusually lengthy statement showed just how tense relations between the two countries are.

The White House on Thursday rejected the idea that the requested delay was related to the US election, instead tying it to economic considerations and Russia’s war with Ukraine.

John Kirby, the National Security Agency’s strategic communications coordinator, said: “We have presented our analysis to Saudi Arabia, stating that there is no market justification for lowering production targets and that they can simply wait until the next OPEC meeting. showed,” he said. Council.

“Other OPEC members have also told us privately that they disagree with the Saudi decision but feel compelled to support the Saudi course,” he added. did not name the country.

Relations between the United States and Saudi Arabia have been strained since the 2018 murder and amputation of Washington Post columnist Jamal Khashoggi.Washington believes it came on the orders of Saudi Crown Prince Mohammed bin Salman. Meanwhile, rising energy prices are providing weapons Russia can use against the Western powers that have armed and supported Ukraine.

Saudi foreign ministry statement admits Saudi Arabia had been in talks with US to postpone OPEC+ 2 million barrel cuts Announced last week.

“The Royal Government, through ongoing consultations with the US Government, has concluded that all economic analysis suggests that postponing the OPEC+ decision by one month would have negative economic consequences. ,” the ministry said in a statement. .

A ministry statement confirmed details of the Wall Street Journal article An unnamed Saudi official said this week that the US is trying to delay the OPEC+ production cuts until just before the midterm elections. I am quoting what you said.

The kingdom also criticized attempts to link the decision with Russia’s war on Ukraine.

“While striving to maintain the strength of its relations with all friendly nations, the Kingdom will not allow any orders, actions or efforts to distort the noble purpose of protecting the world economy from oil market volatility. “The solution to economic challenges is to establish a non-politicized, constructive dialogue that considers wisely and rationally what is in the interests of all nations.” need to do it.”

Saudi Arabia and neighboring United Arab Emirates, the main producers of OPEC, voted in favor of a UN General Assembly resolution on Wednesday. Condemns Russia’s “attempted and illegal annexation” of four regions of Ukraine and calls for its immediate withdrawal.

In Congress, Senator Chris Murphy, a Democrat from Connecticut who has long been critical of Saudi Arabia, proposed a new freeze on military aid to the kingdom. He has called off a planned transfer of surface-to-air missiles to Riyadh and suggested instead sending them to Ukraine, which has recently faced a new barrage of Russian artillery fire..

Saudi Arabia has been targeted by Iran-backed Houthi rebels in Yemen.The Houthis hold the country’s capital in a long and bitter war in the Arab world’s poorest country. the system was essential Aim for the kingdom

OPEC, once powerful enough to hold back the United States with oil embargoes in the 1970s, saw nonmembers like Russia in 2016 fall after prices dipped below $30 a barrel amid rising U.S. production. had to push for production cuts. The 2016 agreement gave rise to the so-called OPEC Plus, which joined the cartel to cut production to stimulate prices.

The coronavirus pandemic has pushed oil prices temporarily into negative territory Before air travel and economic activity resumed following lockdowns around the world. Benchmark Brent crude was above $92 a barrel earlier on Wednesday, but oil producers fear prices could plunge amid a battle against inflation.

Mr. Biden, who famously called Saudi Arabia a “outcast” in the 2020 election campaign, visited Saudi Arabia in July and banged his fist on Prince Mohammed before a meeting.Despite outreach, Saudi Arabia has supported keeping oil prices high to fund Prince Mohammed’s aspirations. This includes his planned $500 billion futuristic desert city project, Neom.

Prince Mohammed and his father, King Salman, hosted former President Donald Trump’s first trip abroad and enjoyed a closer relationship with the regime. King Salman once told the crowd that he “might not be there” without the support of the US military..

On Tuesday, Biden warned of Saudi Arabia’s implications for the OPEC+ decision.

“What they’ve done to Russia will have consequences,” Biden said. Let’s go.”


Washington AP writer Aamer Madhani contributed to this report.


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